Annual report shows 1.7 million Israelis living below poverty line

Report shows 3% rise in elderly Israelis in 2012; Opposition leader Herzog: Government has no plan for fighting poverty.

Poverty in J'lem 370.
(photo credit:Marc Israel Sellem)

More than 1.7 million people are living in poverty in Israel today, according to
the annual poverty report that the National Insurance Institute and the Central
Bureau of Statistics released on Tuesday.

According to the report, in
2012 there were 1,754,700 people, including 439,500 families and 817,200
children living below the poverty line.

This marked a slight improvement
from the 2011 statistics, which found 1,838,600 people, 442,000 families and
860,900 children living in poverty.

According to the report, an
individual with a monthly income of less than NIS 2,820 and couples earning less
than NIS 4,513 per month are considered to be living below the poverty line.
Furthermore, a family of five individuals must earn more than NIS 8,500 to be
considered above the poverty line.

The findings indicated that in 2012
the number of families living in poverty had fallen from 19.9 percent in 2011 to
19.4%, while the overall number of poor people had fallen from 24.8% in 2011 to
23.5% of the population. The number of poor children also fell nearly 2% from
2011, to 33.7% in 2012, while the poverty rate among seniors increased by 3% to
22.7%, a total of 186,700 seniors living in poverty.

The findings further
indicated a troublesome trend: 5% of families with two workers or more – some
50,700 families – were living below the poverty line in 2012, up from 4.6% in
2011 and an overall increase of 2% from 1999. The poverty rate for working
families with only one provider was 24.6% in 2012, compared to 25.9% in 2011.
Sixty-six percent of families with no providers were living below the poverty
line.

In 2012, 13.7% of working families lived below the poverty line, a
dramatic increase from 7% over a decade ago (1999). The report estimates that
64% of poor families with children live in continued poverty, with the average
gap between household income and the poverty line standing at 34.4%.

The
report also relayed a startling gap between different population groups in
Israel. The incidence of poverty among Arab families in 2012 was a staggering
53.4%, and comprises 36.6% of poor families in Israel today as compared to 14.1%
of Jewish families.

The report also notes that the level of poverty and
its severity indicates a higher level of distress among the Arab
population.

According to the study, the Jerusalem district, taking into
account the percentage of the poor and the severity of their conditions,
recorded the highest poverty rates in 2012 with 59.4% of children and 34.7% of
families living below the line. In contrast, the central region has the lowest
rates with 15.9% of children and 9.9% of families living in poverty.

When
compared to other OECD countries, Israel has the third-highest poverty rates,
after Mexico and Chile – a slight improvement from second place. In addition,
the GINI index of inequality indicates that Israel continues to remain among the
countries with the highest measure of inequality, after Chile, Mexico, Turkey
and the US.

On a slightly more optimistic note, the report estimates that
in 2012, 36% of families, including some 128,700 children, escaped from
poverty.

A letter included in the report from National Insurance
Institute Deputy Director-General for Research and Planning Dr. Daniel Gottlieb
commended several government policies in combating poverty – most notably the
appointment of a committee to fight poverty, headed by Eli Alalouf, which he
said indicated a “step in the right direction.” However, he warned that cutting
child allowances in 2013 indicated a step in the wrong direction.

The
2012 poverty report marked the first year in which data for analysis was
gathered from household expenditure surveys only, as opposed to joint household
expenditure surveys and income surveys of the workforce as in previous years
(1997-2011). According to the authors of the report, the calculation methods
remained the same, but the data base has changed, and this should be taken into
account when comparing the 2012 data with previous years.

The Central
Bureau of Statistics surveyed 9,000 household respondents about both income and
expenses, compared to 15,000 surveyed in 2011.

In addition, the CBS
included several changes to the household expenditure survey: nearly doubling
the volume sampled, increasing the coverage of the Arab population in the North,
considering soldiers in regular service as employees, and including for the
first time “renewing” Kibbutzim, while excluding the Beduin population in the
South.

The report further addressed the changes in policy that should be
taken into consideration when reviewing the study results – most notably that
this was the second year that the grant for workers had been expanded to include
the entire economy, and that this year marked a halt to the increase in pension
benefits, as characterized by the 2009-2011 period.

Peres called on the
government to provide for every child until at least the age of three, saying it
was unacceptable for 800,000 children in Israel to be hungry.

The
president estimated the project would be in the realm of NIS 300 million, which
he declared a drop in the ocean of the national budget, and called for the
immediate implementation of an essential nutrition project.

He added for
senior citizens whose pensions do not stretch to pay for food, medications and
utilities that they should receive a supplementary grant of at least NIS 1,000
per annum.

Peres praised Alalouf, a former director- general of the Rashi
Foundation, and said that if anyone could get the nutrition project off the
ground, it would be Alalouf.

After presenting the report, Cohen, a former
mayor of Dimona who grew up in a family of nine amid poverty in the peripheral
development town, said, “The problems of poverty are not the problems of the
poor, but the problem of the whole country and of the government.”

Cohen
was particularly concerned by the high rate of poverty among families in which
both parents work but together do not bring in sufficient income to take them
out of the cycle.

He expressed a desire to change regulations that
deprive single-parent families of NII grants if the parent is working,
regardless of how little the parent may be earning.

Cohen said that both
he and Alalouf had met with Prime Minister Binyamin Netanyahu and Finance
Minister Yair Lapid, who were each committed to the alleviation of poverty. In
fact, Lapid had made NIS 4 billion available for education, health, culture and
social welfare needs.

“Everyone took responsibility for caring for the
needy except the government,” Cohen said, and added that in the past, the
problems of poverty were dealt with by non-profit organizations and generous
philanthropists, but that it should be the responsibility of the
government.

Cohen added that dependence on child allowances kept families
permanently below the poverty line, and that he was in favor of
cutbacks.

Against the backdrop of the NII poverty report, the Knesset on
Tuesday marked the International Day for Combating Poverty with a series of
events and discussions; MKs were quick to respond to the findings of the
report.

“Poverty is a strategic threat to the state of Israel,” said
opposition leader Isaac Herzog (Labor). The 2012 poverty report presents a
“difficult picture, where more and more families with two working parents do not
manage to survive.”

He called for the government to reassess the budget
and allocate NIS 4 billion a year, for 10 years, to fight poverty and expressed
fears that the next report “will be much worse.”

The opposition leader
directly blamed Netanyahu for the unfortunate findings of the report, and said
the prime minister was leading a “damaging economic policy along with [past]
finance minister Yuval Steinitz... and Finance Minister Yair Lapid
today.”

Fellow Labor MK Itzik Shmuli said on Tuesday, “I want to
congratulate this government that occupied first place for the highest poverty
rates in the Western World. The number of poor people and poor children is only
increasing and the finance minister tells Israelis of growth and
innovation.

Lapid scolds the poor to go and work but the statistics show
that not only a majority of the poor are working people, but 25% of poor
children go out and work. The government must set social targets in legislation
to eradicate poverty and reduce inequality; we have had enough of empty
declarations of importance to the government, when all the government does is
tell people to go to work.”

Charity organizations also voiced their
concerns to the statistics of the poverty report on Tuesday.

“The
statistics have not changed in years and it’s not a case of no news is good
news. It’s indicative of the lack of planning and lack of changes being
implemented to alter the poverty crisis in Israel,” said Gidi Kroch, CEO of
Leket, Israel’s national food bank.

“In 2008, the government proclaimed
that it had set a goal to increase the income of the lower 20th percentile. A
short time later it put this initiative on hold and then canceled it altogether.
When the government draws up plans and then cancels them and the Knesset isn’t
monitoring government work, no wonder we are in a state of crisis in poverty and
ranking at the highest places in the OECD,” added Kroch.

“The
International Fellowship of Christians and Jews meets poverty every day, in
every city, in every sector, at every age. We see too many citizens that are
unable to exist respectably.

Especially hard is the problem among the
elderly. The increase in poverty rates among them is a societal and moral red
line that we are not allowed to cross,” said founder and president of the
International Fellowship of Christians and Jews Rabbi Yechiel
Eckstein.

“The initiative of Social Welfare Minister Meir Cohen to
appoint a committee to fight poverty that we are a part of is an important step;
though without full governmental guidance and backing, shaping policy and
setting clear targets requiring allocation of adequate funding essential for the
war against poverty, it will have no use,” added Eckstein.

Gil Hoffman and
Lahav Harkov contributed to this report.

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